JAIHIND NAGARI SAHAKARI PATSANSTHA, MARYADIT,PUNE vs. PRINCIPAL COMMISSIONER OF INCOME TAX, PUNE-3, PUNE

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ITA 542/PUN/2023Status: DisposedITAT Pune06 June 2023AY 2018-193 pages

In favour of the assessee: the assessee's appeal was allowed. From the AI summary of this appeal.

AI SummaryAllowed

What did the Tribunal hold?

The Tribunal held that while cooperative banks are not eligible for deduction under Section 80P(4) after 2007, a cooperative society can still claim deduction under Section 80P(2)(d) on interest income from deposits with another cooperative society.

What were the facts?

The assessee claimed deduction under Section 80P for interest income earned from deposits with Cooperative Banks, which was allowed by the AO. The Pr.CIT invoked Section 263, considering the assessment order erroneous and prejudicial to revenue.

What were the issues?

Whether a cooperative society is eligible for deduction under Section 80P(2)(d) on interest income earned from deposits with another cooperative bank, notwithstanding the provisions of Section 80P(4).

Which sections of the Income-tax Act were involved?

Section 80P,Section 263,Section 80P(4),Section 80P(2)(d),Section 2(19)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, PUNE ‘A’ BENCH, PUNE

Before: SHRI R.S. SYAL & SHRI PARTHA SARATHI CHAUDHURY

For Appellant: Shri Pramod S. Shingte, CA
For Respondent: Shri Keyur Patel, CIT-DR

IN THE INCOME TAX APPELLATE TRIBUNAL PUNE ‘A’ BENCH, PUNE BEFORE SHRI R.S. SYAL, VICE PRESIDENT AND SHRI PARTHA SARATHI CHAUDHURY, JUDICIAL MEMBER आयकर अपऩल सं. / Assessment Year : 2018-19 Jaihind Nagari Sahakari Vs. Pr.CIT, Pune-3. Patsanstha Maryadit, Narayangaon, Tal- Junnar, Dist. – Pune. PAN : AAAAJ 2456 Q Appellant Respondent Assessee by Shri Pramod S. Shingte, CA Revenue by Shri Keyur Patel, CIT-DR Date of hearing 31-05-2023 Date of pronouncement 06-06-2023 आदेश / ORDER Per PARTHA SARATHI CHAUDHURY, JM:

This appeal by the assessee is directed against the order dated 14-03-2023 passed by the Pr.CIT in National Faceless Appeal Centre (NFAC) u/s.263 of the Income-tax Act, 1961 (hereinafter also called ‘the Act’) in relation to the assessment year 2018-19. 2. Succinctly, the facts of the case are that the assesse filed its return claiming deduction u/s.80P in respect of interest income earned from the deposits kept with Cooperative Banks, which was allowed by the AO. The ld. PCIT invoked the jurisdiction u/s 263 of the Act and disputed the allowability of the claim of deduction either u/s.80P(2)(a)(i) or u/s.80P(2)(d). Aggrieved thereby, the assessee has come up in appeal before the Tribunal.

3.

We have heard the rival submissions and gone through the relevant material on record. The ld. PCIT has held that the assessment order to be erroneous and prejudicial to the interest of the Revenue only on the ground that the claim of deduction u/s.80P on the interest income was not in order. In this regard, it is observed that though co-operative banks, other than primary agricultural credit society or a primary co-operative agricultural and rural development bank, are not eligible for deduction pursuant to insertion of section 80P(4) w.e.f. 1.4.2007, but this provision does not dent the otherwise eligibility u/s 80P(2)(d) of the Act of a co-operative society on interest income on investments/deposits parked with a co-operative bank, which is a registered co-operative society as per section 2(19) of the Act, defining co-operative society to mean a co-operative society registered under the Co-operative Societies Act, 1912 or under any law for the time being in force. Similar view has been taken by the Pune Benches of the Tribunal in several cases including The Sesa Goa Employees Coop. Credit Society Ltd. Vs. ACIT (ITA No.203/PUN/2019, order dated 16-11-2022).

4.

In view of the foregoing discussion, we hold that the impugned order cannot be sustained. The same is, therefore, overturned.

5.

In the result, the appeal of the assessee is allowed.

Order pronounced in the Open Court on 06th June, 2023.

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